Also known as 'sealed first price' or 'first-price sealed-bid'
auction.

Beyond these, there are a wide range of auctions and variants that may be
used within these auctions, such as charging bidders an entrance fee, having
'rounds' where bidders are knocked out, and 'buy now' pricing where customers
can bypass the auction and buy beforehand.

Example

A retail store holds an auction outside their front door of
goods they need to shift. They attract a lot of attention as customers hope to
be able to get a bargain.

An online electronics retailer holds monthly auctions to
sell off stock that has not moved or which is likely to decline in value over
time.

Discussion

Sellers want to get the best price for their goods, and may worry that they
are over-pricing when sales are slow, or are pricing too low when sales go too
quickly. While retailers seldom use auctions they are used in a wide range of
contexts.

Auctions are generally designed to encourage bidders to make as high a bid as
possible. The standard auction can easily draw people in so they bid far higher
than they originally intended, especially if they feel a sense of competition
with other bidders and it turns into a power and status game of 'who can afford
the most'. Dutch auctions

The concerns of sellers may be protected when a 'minimum bid' is set. This
may not be revealed until the final bid is received, in which case a 'no sale'
may be announced if all bids are too low.

The auction may be run by auctioneers, who act as marketing and trust-broking
middle people who take a cut, typically a percentage of the selling price, from
one or both of the seller and buyer. This helps motivate the auctioneer to get
the highest price possible.

Online auctions allow for a much wider bidding audience and can be run
automatically. Traditional physical auctions can require significant effort to
publicize and run.